Increasing operator expenses continue to dog nursing homes, with higher prices for liability and property insurance eating into budgets, a new survey finds.
More than 80% of respondents in the latest NIC Executive Survey cited operator expenses as a major challenge.
When asked to compare the cost of their professional liability insurance to one year prior, just over half of nursing care operators (52%) said their rates had gone up significantly or slightly. Still, those rate hikes were lower than among their senior living peers. About two-thirds of memory care and assisted living operators reported slight or significant increases, followed by three-fifths of independent living operators.
Forty-eight percent of nursing home respondents said they had not experienced an increase.
No owners or operators reported a decrease in the cost of professional liability insurance, Ryan Brooks, senior principal for the National Investment Center for Seniors Housing & Care wrote in a blog Tuesday.
The findings, gathered from just 47 providers across the nation in May, reflect the broad trends projected by major insurance brokers and liability observers are becoming a reality for many.
Willis Towers Watson in March reported that the growing number of aging services claims over $1 million is growing, creating a “volatility” that “has a psychological impact on underwriters.”
In the case of nursing homes specifically, there could be more bad news coming at the next renewal. A recent Supreme Court decision opens up publicly owned and affiliated facilities to new federal lawsuits, which could lead to big payouts in jury cases. In states with a high concentration of publicly owned facilities, the increased costs of insuring them could bleed over into rates of non-public facilities, experts have warned.
The NIC survey also revealed property insurance rates increased compared to last year.
Between 86% and 95% of operators across all care segments reported increases, with almost one-third of nursing home respondents (32%) saying their rates had “significantly” increased.
Climate change and the increased impacts of destructive weather systems have been cited as a driving factor on the property insurance side.
Alice J. Roden started working for Trending Insurance News at the end of 2021. Alice grew up in Salt Lake City, UT. A writer with a vast insurance industry background Alice has help with several of the biggest insurance companies. Before joining Trending Insurance News, Alice briefly worked as a freelance journalist for several radio stations. She covers home, renters and other property insurance stories.